Gold halted its streak of sharp declines today, which had dragged the commodity's price down by 8.8% this week. Futures contracts broke through a series of solid support levels and are currently trading at their lowest since November 2025 at around $4,080 per ounce. A rebound in risk appetite has delayed a test of the psychological $4,000 level, but hawkish outlooks for U.S. interest rates suggest that downward pressure on the precious metal will persist.
Gold remains under intense selling pressure, breaching a series of key support levels, including the 50% ($4,670), 61.8% ($4,500), and most recently the 78.6% ($4,250) Fibonacci retracement levels. The aggressive breakdown of these barriers dragged the price down to $4,085.64, leaving the metal exposed to a test of the psychological $4,000 barrier. The RSI indicator has plunged to 26.1, signaling deeply oversold market conditions. Source: xStation5
What’s Driving Gold Prices Today?
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U.S.-Iran Conflict Escalation: New missile and drone attacks in the Middle East shattered hopes for a ceasefire. Crude oil gains stalled today (OIL: -2.6%) in response to the U.S. announcing the "conclusion" of its operation, which Donald Trump labeled a "punishment for negotiating too long." On the other hand, Iran called the ceasefire "meaningless" given the recent exchange of fire, cementing the outlook for a prolonged and uncertain conflict—which in turn reinforces hawkish expectations for U.S. monetary policy.
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Hawkish Fed and Rate Outlook: The Consumer Price Index (CPI) at 4.2% year-over-year has solidified expectations that the Federal Reserve will keep interest rates higher-for-longer. Because gold yields no interest, the prospect of elevated rates heavily dampens its appeal, especially given its already historically high valuations.
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Cushion From Softer Core Inflation: While the headline inflation rate spooked investors by returning above 4%, the monthly core CPI grew by a mild 0.2% (2.9% YoY, in line with forecasts). This slightly softer print gave precious metals a breather and allowed them to halt their downward trend.
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